Sports authority approval a big step forward for American Dream plan

By Joshua Burd,
May 17, 2013 at 2:09 PM

Efforts to revive the former Xanadu project leapt forward today, as the agency overseeing the Meadowlands Sports Complex voted to allow the site to be turned over to a new developer and approved its plan to add water and amusement parks to the complex.

Approval from the state Sports & Exposition Authority clears the way, for now, for developer Triple Five to move ahead with the proposed640,000-square-foot expansion, part of its effort to rebrand the retail and entertainment complex as American Dream Meadowlands. Acting on recommendations made by its master plan committee, the agency's board granted the approvals despite objections by the New York Jets and Giants, which filed a lawsuit last year to stop the expansion, and could still do so following the votes.

The board today voted on four measures, including a motion to transfer the property's ground lease and development rights to the Edmonton, Canada-based developer from the lenders that now control it. Also included was a move to give Triple Five access to do preliminary site work, designate the land as an area in need of redevelopment — required in order to qualify the project for $250 million in tax-exempt bonds — and a resolution to amend the sports authority's master plan for the Meadowlands Sports Complex.

Despite objections from the teams and other parties, the board's master plan committee voted to advance the project after finding there was not "sufficient merit to warrant rejection of the proposed major modifications," said Peter Torcicollo, counsel for the sports authority. The committee also found that it did not need the consent of the Jets and Giants, which occupy nearby MetLife Stadium.

A spokeswoman for the teams said they would be considering their next move.

“We learned just 48 hours ago that there would be a meeting of the NJSEA to vote on the AD project," said Karen Kessler. "We had not seen any of the resolutions. Now that the vote occurred, we will be evaluating our options.”

State officials have spent months trying to broker an agreement between the teams and the developer that would allow the project to move forward. After today's meeting, NJSEA chief Wayne Hasenbalg said the agency has done a painstaking review to get to the point of moving the project forward.

"We've gone through a very thorough process, and I think we've reached the conclusion that we're prepared to act now," Hasenbalg said. "And this doesn't close the dialogue at all. There's always going to be ongoing dialogue with all of the parties involved here, and that will continue."

Representatives for Triple Five said today they hope to close on the transfer by the end of May.

The vote comes a decade after its original developer, Mills Co., broke ground on the now-infamous megaproject, then known as Xanadu. The complex was supposed to open in 2007, but was derailed by financial woes and litigation — problems that have plagued subsequent developers as the building's hideous exterior languishes at the Meadowlands Sports Complex.

Gov. Chris Christie turned in 2010 to Triple Five, owner of the Mall of America, in Minnesota, to rescue the project as American Dream Meadowlands. But the firm's plan to add water and amusement parks sparked a lawsuit last June by the New York Jets and Giants, who say the expansion would cripple game-day traffic around MetLife Stadium.

The teams argued the plan violates a 2006 agreement with Mills that effectively gave them veto power over changes to the project that might harm them. A judge dismissed the lawsuit in deference to the pending review by the sports authority's master plan committee, but said the teams could return to court to appeal its final decision.

Meanwhile, Triple Five spent much of last year checking off a long list of regulatory approvals. It's also sought to conclude negotiations with the lenders from Colony Capital, the private-equity firm that was forced to turn over the site in 2010, and pursue nearly $2 billion of financing needed to complete the project.